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Johannesburg - The rand held on to the previous day's gains against the dollar on Friday, after the South African Reserve Bank raised the repo rate, while stocks were set to open higher buoyed by a global market rally.
The JSE's Top 40 futures index was up 0.13%, indicating that the actual stock index would open more than 60 points higher at 09:00.
By 08:53 the rand was at R14.0200/$, up 0.02% from Thursday's close. It stood at R13.99 just before noon.
The Reserve Bank lifted interest rates by 25 basis points to 6.25%, to curb future inflation risks.
READ: Pain for consumers as SA hikes rates
Analysts said the decision to hike before the US Federal Reserve pulled the trigger was a pre-emptive one around concerns surrounding the weakness of the rand, financial market stability and capital flows.
"While the rate hike might prove bad for long-term growth, it has allowed for some renewed strength in the currency. Should the Fed hike in December this would help to provide some cushioning for the rand," Rand Merchant Bank currency strategist John Cairns said.
READ: 6 graphs that led Sarb to increase repo rate
Global markets have been trading risk-on and profit-taking knocked the greenback off seven-month peaks against a basket of peers, which provided the additional impetus to the rand.
Government bonds also strengthened across the curve with the yield on the benchmark government bond maturing in 2026 shedding 2 basis points at 8.435%.
